When you are young and working, it is easy for you to manage and accordingly divide your expenses. This allows you to put some money aside for investment keeping your future in mind. However, this is not possible during post-retirement. While you have invested in financial products to grow your wealth, most of those returns will be spent on accomplishing life goals.
Your family would not be able to maintain their financial stability on the basis of your savings. Therefore, you need to invest in a good life insurance policy. If you are wondering if senior citizens require life insurance plans, read on to know more about how it could help them.
What is life insurance?
A life insurance policy is a type of policy in which the insurer compensates the family of the insured. This compensation is given in the event of the policyholder’s untimely demise. This compensation will help the dependents manage all the necessary expenses and have a financial safeguard from various life risks. Since there are different life insurance plans to choose from, the amount that will be disbursed by the policyholder is dependent on the plan you select.
Why should senior citizen opt for life insurance?
As someone who is nearing their retirement, listed below are a few reasons to opt for a life insurance:
1. For the future of your dependents
If you are the sole earner of your family, there can be co-dependents who are relying upon you. Even if you are a senior citizen, there could family members who would be relying on your savings. It could be your children who are not entirely financially independent, or it could be some relative who does not have any source of income and is dependent on your care and income. To provide sufficient corpus for their future, it is advised to opt for a life insurance.
2. For the financial independence of your partner
There are situations wherein it might just be you and your partner with no one to look out for your partner, especially, if you are the sole breadwinner. In such situations, your spouse could become financially vulnerable if you were to pass away suddenly. This could lead to your partner having to borrow money, or sell, or mortgage things in order to manage expenses. A life insurance plan will help them avoid such situations. Not only the pay-out would help them with the daily expenses, it would also allow them to be financially independent as well.
3. To manage outstanding loans
There could be instances where you purchased a home on loan. Or it could be a business loan to retire early and start your own business immediately. While it is easy for you to make repayments while you are still working, this is not the case when you have retired. The repayment will be done based on your savings, which could deplete them drastically. Such a situation could create financial instability for your loved ones, especially, in times of emergency. The sum assured your family would receive from the life insurance policy could be used to clear any outstanding loans or debts. This would also keep the savings untouched for other purposes.
What are the things to remember?
While a life insurance for your life post-retirement will be highly beneficial, do keep in mind that the cost of policy could escalate if you purchase it late. As you have aged and you could be having medical conditions, the insurer will charge you more for the policy. Invest in this policy as early as you can to avoid paying higher premiums.
These are some of the reasons why senior citizens should opt for a life insurance policy. If you are interested in purchasing one for yourself, you can use the life insurance premium calculator to get an idea about how much your policy would cost you.